104 Groups - Immoral for Malaysia to take from Workers to overcome national economic problems,Employers should pay the Levy – Not Migrant Workers

Joint Statement – 12/2/2016

Employers should pay the Levy – Not Migrant Workers

Immoral for Malaysia to take from Workers to overcome national economic problems

We the 104 undersigned civil society organisations, trade unions and groups are shocked by the news that the Malaysian government is increasing the migrant worker (foreign worker) levy to more than double the current rate, which since January 2013, had to be paid by the migrant workers themselves.  Prior to that, it was paid by the employer of migrant workers, whereby the introduction of the levy then was to deter employers employing migrant workers, rather than local Malaysian workers. This was also stated by the then Malaysian Labour Director-General Datuk Ismail Abdul Rahim who was quoted saying that, “…The rationale behind getting employers to bear the levy was to discourage them from employing foreigners…”  [Star, 16/4/2009]

Migrant Worker Levy Rates Drastically Increased as of 1/2/2016

The Malaysian government recently announced that, as of 1/2/2016, annual levy payable for each migrant worker is increased to RM2,500 (manufacturing, construction and service sectors) and RM1,500 (plantation and agriculture). Before this, the annual levy payable for a Migrant Worker in the Manufacturing sector (RM1,250), Construction sector (RM 1,250), Plantation sector (RM590), Agricultural sector (RM410) and Services sector (RM1,250 – RM1,850) which was so much lower.

This new rates in comparison greatly burden the migrant worker in that the annual levy payable per migrant worker will now be doubled, or even tripled. 

For example, a migrant worker in an electronic factory, classified under the manufacturing sector, who paid a levy of RM1,250 before, will now have to pay double, RM2,500. A worker earning a monthly minimum wage of RM900, which is the wage many migrants are paid, will now have to pay more than RM200 for levy, leaving them with only less than RM700 as their monthly wage, not taking into account all other wage deductions. This is most unjust.

It is unconscionable for the Malaysian government to target migrant workers in the hope of making extra income of RM2.5 billion for the country from the 2.1 million documented migrant workers in Malaysia to rescue Malaysia from its current financial woes.

Easily Exploited With Almost No Access to Justice Makes Migrant Workers Vulnerable to Employers

When Malaysia, introduced Minimum Wage, employers and employer groups complained that their labour cost had gone up, and they could not afford it. In response, the Malaysian government decided that employers no longer need to pay the migrant worker levy, thus the obligation to pay the levy fell on migrant workers themselves.

Contract substitution remains a problem. Migrant workers agree to come to work in Malaysia, but when they start working, the migrant workers complain that they are now paid lower than what they had agreed to in their country of origin with the employer and/or his agent. Many employers have also used the Minimum Wage of RM900, as the standard wages they pay migrant workers. 

Because of the debt incurred by migrant workers in coming to Malaysia to work, which is about RM5,000 and the practice of employers and/or agents holding on to their passports and work permits, migrant workers find themselves in a form of bonded labour, and not able to do anything else but just survive. 

With the very low wages, they receive; many are forced into doing overtime sometimes 4 hours per day, working on rest days and even public holidays to make ends meet. Malaysian law stipulates a draconian overtime limit of 104 hours every month. This means, in effect migrant workers can be forced to work for 12 hours a day because in many workplaces doing overtime is no longer an option that workers can refuse. As such, migrant workers and even local workers can be considered to be engaged in some form of ‘forced labour’.

For migrant workers, access to justice remains a myth for many. When they complain about rights violations, what happens in many cases is that they are terminated, and their permit to work and/or remain in Malaysia is also terminated. This causes migrant workers to be easily controlled and exploited cheaply. They do not even have the option to claim justice.

Employers Contribute Less to Migrant Workers Income

Under the Malaysian law, employers are required to contribute 13% of the monthly income, inclusive of overtime earnings, to the Employees Provident Fund, this requirement is not applicable to the migrant workers. This makes migrant workers cheaper.

Further, since many employers do not take in migrant workers directly as their own employees, but take and use them as workers who are supplied by the labour suppliers - legally known as the contractors for labour - it effectively prevents these supplied migrant workers the right to join in-house trade unions. Even if they do join national/regional unions, they simply will not be able to enjoy the extra rights and benefits that come by reason of a Collective Bargaining Agreement between Union and Employer, simply by reason that they are not recognised as employees. Calls for the abolition of the ‘contractor for labour system’ by trade unions and civil society have gone unheeded by the government. 

Malaysia recognizes that households earning less than RM4,000 a month requires financial assistance, and local workers do get a small assistance from the government through the BR1M program – but migrant workers are excluded from this benefit.

Weakening Ringgit Causes Migrants to earn 20-40% less.

Whilst, the financial problems Malaysia is facing, coupled with the increased cost of living - new taxes, increased transportation costs, and the weakening of the Malaysian Ringgit in relation to currency of the country of origins of migrants – it is the migrant worker who suffers the most. 

The weakening ringgit also means that the money migrant workers send back home to their families is now much less and this has a serious impact on their families/dependents and the ability to settle their debts back home. It was recently reported, that "For instance, employees from Bangladesh used to make 44 taka for every RM1, but now it is about 17 taka. The drop is very drastic, more than 40%."Even the ringgit to the Indonesian rupiah has seen a drop in value by 20%," (Malaysian Insider, 5/2/2016)

Unjust to impose New Financial Obligations On Migrant Workers Already In Malaysia

It is totally unjust for Malaysia to impose new financial obligations by law on migrant workers, which did not exist when they agreed with their employers to come and work in Malaysia for 3-5 years. Any new obligations especially of payment by migrant workers should only apply to new migrant workers who have yet to agree to come to Malaysia to work – certainly not to those who are already here and working.

The Malaysian Trade Union Congress(MTUC) and employer groups have been informed that employers will now have to  pay migrant worker levy. This was also mentioned in a media report, which stated, ‘The FMM[Federation of Malaysian Manufacturers] said the government recently informed employers that the levy burden would be shifted back to them. (Star, 2/2/2016).

However, employer groups have started a campaign lobbying the Malaysian government to re-consider, and 
the Malaysian government has been reported as saying that they may re-consider. There is concern that this re-consideration may not just be about the amount of levy payable, but also the question as to who will have to pay the levy – migrant workers or their employer?

Therefore, we the undersigned

Call on the Malaysian government in the name of justice, to ensure that it must be the employers of migrant workers that should be paying this Migrant Worker levy – not the migrant workers;

Call on the Malaysian government to also reconsider the increase of the levy rate, at this time whilst Malaysia, and especially small Malaysian businesses, are affected by the economic crisis and the effect of the falling Malaysian ringgit.

Call on the Malaysian government to increase the Minimum Wage of all workers in Malaysia to RM1,200 – RM1,500, to compensate for the increased cost of living in Malaysia, and the falling value of the Malaysian ringgit with  reference to the currency in migrant worker’s countries of origin. 

Call on the Malaysian government to abolish the ‘contractor for labour’ system, and ensure that all workers that are working in a workplace are all recognised employees of the said workplace, and are treated equally as workers.

Charles Hector

Mohd Roszeli bin Majid

Pranom Somwong

For and on behalf of the 104 organisations, trade unions and groups listed below 

ALIRAN

Alternative ASEAN Network on Burma (ALTSEAN-Burma)

Asia Monitor Resource Centre(AMRC)

Asia Floor Wage Alliance

Asia Pacific Forum on Women Law and Development (APWLD)

Association of Human Rights Defenders and Promoters- Myanmar

Asociación de trabajadoras del Hogar a Domicilio y de Maquila, ATRAHDOM, Guatemala, Centro Amercia. 

Bangladesh Groep Nederland (Bangladesh Group The Netherlands)

Bangladesh Institute of Labour Studies- BILS

BLAST,  Bangladesh

Boat People SOS (BPSOS)

Building and Wood Workers International (BWI) Asia Pacific Region

Campagna Abiti Puliti – Italy

CARAM Asia

Clean Clothes Campaign International Office(CCC)

Club Employees Union Peninsular Malaysia(CEUPM)

Coalition to Abolish Modern-day Slavery in Asia (CAMSA)

Crispin B. Beltran Resource Center (CBBRC),Philippines

CWI Malaysia (Committee for Workers International)

Defend Job Philippines

Fair – Italy

FAIR ACTION, Sweden

Foundation For Women, Thailand 

Garment and Allied Workers Union, India

German Clean Clothes Campaign

Homeworkers Worldwide, United Kingdom

IDEAL (Institute for Development of Alternative Living）

IndustriALL Bangladesh Council (IBC)

Institut Rakyat

International Labor Rights Forum

Jaringan Rakyat Tertindas (JERIT)

Jatio Shromik Federation (JSF), Bangladesh

Karmojibi Nari (KN), Bangladesh

Kesatuan Pekerja-Pekerja Perodua

Kesatuan Sekerja Industri Elektronik Wilayah Selatan, Semenanjung Malaysia (KSIEWSSM)

Knowledge and Rights with Young people through Safer Spaces (KRYSS)

Labour Behind the Label

Labour Studies and Action Centre (CEREAL), Mexico

Legal support for Children and Women (LSCW), Cambodia

MADPET (Malaysians Against Death Penalty and Torture)

Malaysian Election Observers Network

Malaysian Trades Union Congress (MTUC)

MAP Foundation (Thailand)

MHS Aviation Employees Union

Migrante International

Mission for Migrant Workers

Myanmar Migrants Rights Centre

NAMM (Network of Action for Migrants in Malaysia)

National Garment Workers Federation (NGWF), Bangladesh

National Union Employees in Companies Manufacturing Rubber Products (NUECMRP)

National Union of Transport Equipment & Allied Industries Workers (NUTEAW), Malaysia

NLD LA Malaysia

North South Initiative

Oriental Hearts and Mind Study Institute(OHMSI)

Panggau Sarawak

Paper Products Manufacturing Employees’ Union of Malaysia (PPMEU)

Parti Rakyat Malaysia(PRM)

Parti Sosialis Malaysia (PSM)

Pax Romana ICMICA

Peoples Service Organisation (PSO)

Persatuan Sahabat Wanita Selangor (PSWS)

Pertubuhan Angkatan Bahaman, Temerloh, Pahang, Malaysia

PROHAM -Persatuan Promosi Hak Asasi Manusia

Radanar Ayar Rural Development Association, Myanmar

Repórter Brasil

Safety and Rights Society, Bangladesh

Sahabat Rakyat

Schone Kleren Campagne (CCC Netherlands)

SEA Women's Caucus on ASEAN

Solidarity of Cavite Workers (SCW), Philippines

Sramik Nirapotta Forum, Bangladesh

SUARAM

Tenaga National Berhad Junior Officers Union (TNBJOU)

TENAGANITA Women’s Force, Malaysia

Textile Clothing and Footwear Union of Australia

The Collectif Ethique sur létiquette, Clean Clothes Campaign French

Think Centre, Singapore

UNI Global Union

War on Want

WARBE Development Foundation, Bangladesh

WH4C (Workers Hub For Change)

Women Peace Network-Arakan, Myanmar

Women Rehabilitation Center (WOREC), Nepal

Workers Assistance Center, Inc (WAC) , Philippines

Vietnamese Women for Human Rights

Yaung Chi Oo Workers Association-YCOWA

Yayasan Lintas Nusa, Indonesia

IMA Research Foundation, Bangladesh

International Trade Union Confederation(ITUC)

Women's Aid Organisation(WAO), Malaysia

PINAY (The Filipino Women's Organization in Quebec), Canada

Cividep India

Kesatuan Sekerja Industri Elektronik Wilayah Utara Semenanjung Malaysia

Centro Nuovo Modello di Sviluppo – Italy

National Union of Flight Attendants Malaysia (NUFAM)

Pusat KOMAS

Perak Women for Women Society (PWW)

Asian Migrant Centre

Center for Alliance of Labor and Human Rights (CENTRAL)-Cambodia

Labour Education and Service Network

Mekong Migration Network(MMN)

Kilusang Mayo Uno (KMU), Philippines

MARUAH, Singapore

Center for Migrant Advocacy (CMA) Philippines

 

Media coverage:- 

Employers should pay foreign worker levy, say civil society groups (Malaysian Insider)

'IMMORAL' MALAYSIA GETS A TICKING OFF: Bosses should pay the levy – NOT the migrant workers (Malaysia Chronicle, 13/2/2016))

Employers should pay the levy, not migrant workers (Malaysiakini, 12/2/2016)

 

The said Joint Statement was send to the Prime Minister of Malaysia, Minister of Human Resources, Minister of Home Affair (who is in charge of the Immigration Department), Opposition Leader in Parliament and SUHAKAM(Malaysia's Human Rights Commission). The emailed copy can be seen at ...

101 Groups Letter to PM Najib - Employers should pay the Levy – Not Migrant Workers , Immoral for Malaysia to take from Workers to overcome national economic problems

 

 

 

Reducing worker savings for old age - to allow them to spend now to save Malaysia is Wrong?

EPF:- Workers suffer again BN Government proposes reduction of EPF contribution?

Najib Tun Razak and the BN government is now proposing that the workers contribution to the Employees Provident Fund(EPF) will be reduced by 3%. 

Sounds great - but wait a minute. This would mean that the amount of monthly monies paid into the Worker's EPF Account would reduce...and this is not right as the EPF is the 'Simpanan Hari Tua' (Savings for old age) - this money is to sustain the livelihood of the worker and his family/dependents in their old age when the worker is no longer able to work and earn....until the day he/she dies.

Public servants generally will get pensions right up to the day they die, and thereafter pension will still be paid out to their spouses, and children who have yet to reach the age of majority. These workers, under the EPF scheme, do not have this guaranteed pension payments. It will be the money that they have in their EPF accounts that is expected to support them in the old age.

As it is, it has already been acknowledged, that for most workers in Malaysia, the amount of money that will be in their accounts will now be insufficient to be able to provide for the livelihood of the worker in his old age, In fact, I believe the government is trying to deal with this very real problem with some form of a 'pension scheme' - but it is all work in progress.

So, this BN government is asking poor workers to reduce the save for their old age - and spend that money now. This is so irresponsible.

If Najib is saying that the workers mandatory contribution is reduced by 3%, whilst the employer's contribution is increased - which results in the same amount of monthly contribution to the EPF accounts, then it is OK.

If Najib is saying that the worker's mandatory contribution is reduced by 3%, and the government will bank in the said 3%- which results in the same amount of monthly contribution to the EPF accounts, then it is OK.

But certainly not, this 'save less for your old age' proposal is absurd, and at the end of the day, it is workers under the EPF/KWSP scheme that loses out in the long run.

WHY? So workers will have more money to spend to help the Malaysian economy. This logic was also used in the past by the BN government in the past - when they started allowing workers to take out money from the 'old age savings account'(EPF Account) to spend now for houses, etc...Then also, the rationale, I believe, was to ensure that more money will be spend now by these workers for the sake of the Malaysian economy... 

How much really should a worker be having in his/her EPF account when he/she reaches 55/60/65 to allow him to be able to survive and sustain his/her and dependents livelihood until he/she dies? RM250,000 - RM300,000? Well, we know that for most workers, they will not have even that amount. Factor in the ever increasing cost of living, and also the other monthly loan-repayment obligations. Some workers who purchased homes, will still be repaying loans even after they reach the age they can withdraw from the EPF (old age savings account).

A perusal of the workers, who have already withdrawn from the EPF account, will also show that many of them now do not enough money to sustain their lives until they die.

Hence, Najib's proposal is short-sighted and do not take into account the future lives of workers and their families.

Remember, the EPF scheme affects all private sector workers - and, this BN government, has been shown to be not bothered. While, government employees minimum wages are raised now to RM1,200, the private sector minimum wage will be raised maybe in the middle of the year to just RM1,000. Government employees have COLA[Cost of Living Allowances], private sector workers do not have this. Government employess enjoy access to very low interest loans, but private sector workers do not.

Government employees generally enjoy regular employment until retirement - but in the private sector the government is allowing the unfettered rice of precarious employment practices - short fixed term employment contracts, the unjust contractor for labour systems,...

Now, Saudi Arabia allegedly gave Najib a RM2 billion 'donation' - but he allegedly returned a large amount of it to the donor - that could have been donated by Najib Tun Razak to the government...?

Our target must be that the workers earn MORE and that is sufficient for the livelihood, and for their spending now. They should not be forced, to reduce the contribution to their 'savings for their old age'.

It is the government itself that is to be blamed for the increase of cost of living - so, what needs to be done is to reduce that, so the monies earned by workers now is sufficient...

When a worker takes a loan, he pays high interest to the bank - but if he saves his money in the bank, he receives such low interest. Then, the government allowed banks to impose other charges for withdrawals, for bank statements, etc .. In short, it looks like the Malaysian BN government discourages savings and encourages spending...and for the future of the worker and their family, this smells trouble...

So, Malaysia must increase subsidies for the basic minimal items required by the worker and family for survival. 

Maybe, the government should abolish road tols... reduce water and electricity rate...

Maybe, the recent increase in MP, Senators and ADUNs allowances should be reduced... PM and Ministers pays should be cut. GLC CEOs, Directors and

Sadly, the rich feels it not - but please do consider the majority who are poor... 

Worker earning RM1,000 - with reduction of EPF contribution by 3%, he will take home an extra RM30 a month, RM360 a year. 

RM360 a year - with, say an EPF interest of 6%, he gets  RM21 in interest per year.

So, happily the government said that all this will be spent - RM8billion. Hello, that is the workers' money not being saved but spent... 

REVISED BUDGET 2016: Workers’ EPF contribution cut 3%

BY ANISAH SHUKRY

Published: 28 January 2016 12:49 PM | Updated: 28 January 2016 3:59 PM

EPF contribution by employees will be reduced by 3% under the revised Budget 2016. – The Malaysian Insider file pic, January 28, 2016.

 

Prime Minister Datuk Seri Najib Razak announced the following measures under Putrajaya's recalibration of Budget 2016:

• EPF contributions by employees to be reduced by 3% from March this year until December 2017. Contribution rate by employers, however, remains the same.
• Najib said the reduced contributions would boost spending by an estimated RM8 billion.
• Tax exemption of RM2,000 for Malaysians earning RM8,000 and below for the financial year of 2015, a move that would affect two million tax payers.
•  

Food and cost of living

• To reduce the cost of daily food items, approved permits (APs) for agricultural products, including coffee beans and meats, will be liberalised.
• The Federal Agricultural Marketing Authority (Fama) will open MyFarm outlets to sell produce direct from farmers to consumers at prices between 5 to 20% cheaper.
• Domestic Trade and Consumer Affairs Ministry to increase the number of affordable shopping outlets like hypermarkets.
• RM50 incentive for every metric tonne of rice for paddy farmers.
• MyBeras programme introduced – 20kg of free rice for every registered hardcore poor household.
• GST to remain at the same rate (6%).
• Cash aid programme BR1M will be continued: "The government will not compromise on what is right for the country and people," Najib said.

Housing

• For new housing developments, sale of houses priced not more RM300,000 to be limited to first-time house buyers.
• Bank Simpanan Nasional and Bank Rakyat to offer assistance packages at 4% for homes costing RM35,000 under the People's Housing Projects or PR1MA.

Human resources

• 30% of levy contributed to the Human Resources Development Fund will be used to improve workers' skills and competency, including for those retrenched.
• Government to continue fine-tuning foreign worker management system. Foreign workers' levy will be clustered into two categories but will not include domestic helpers.
• To implement a relocation and rehiring programme for undocumented workers so that they can get valid work permits.

Datuk Seri Najib Razak addresses senior government officials in Putrajaya today to announce changes to Budget 2016. – The Malaysian Insider pic by Afif Abd Halim, January 28, 2016.Improving revenue collection

• Government to increase action against tax evaders; late-filing penalties to be reduced.
•  
• Sale of alcohol and cigarettes on tax-free islands to be limited to licensed, tax-free stores, in order to reduce leakage of up to RM1 billion in revenue.
•  
• Tighten taxes on exemptions for imported vehicles on tax-free islands.
•  
•  
•  
•  
• Optimise revenue from telecommunications by redistributing bidding processes.
• Develop government-owned strategic areas through a bidding process. 

Development spending

• Priority to be given to affordable housing, hospitals, schools, roads, public transportation and security.
• Non-physical projects and projects that are still at planning stage will be postponed. This move is expected to save the government RM5 billion.

Civil service and government-linked companies

• Government to keep its promise of July 1, 2016 additional salary increase for civil servants.
• Government will not touch civil service emoluments and will not stop the services of contract staff in the public sector.
• GLCs urged to reduce salary gap between top management and staff. This will be monitored by the Economic Planning Unit.
• Government to keep its promise of July 1, 2016 additional salary increase for civil servants.

Education and scholarships

• Government to continue the following four Public Service Department (JPA) scholarships for 2016:

1. The National Scholarship Programme (Program Biasiswa Nasional) will allow 20 top SPM-scorers to pursue their studies in universities abroad;

2. The Engineering Special Programme (Program Khas Kejuruteraan) for 200 students to pursue their studies in Germany, France, Korea and Japan;

3. The Bursary Programme (Program Lepasan Bursary) for 744 students to pursue their undergraduate degrees in public and private higher education institutions in the country; and

4. Scholarships for 8,000 students to pursue undergraduate degrees locally.

• The National Higher Education Fund Loan (PTPTN) allocation of RM5 billion will remain.
• Offers to enroll in MyMaster programme to increase by 15,000, MyPhd by 5,000 and IPTA (public universities) Academic Training Scheme by 300. Government to boost allocation by RM300 million.
• MyBrain1 and the Bumiputera Academic Training Scheme will be continued. – January 28, 2016.

- See more at: http://www.themalaysianinsider.com/malaysia/article/revised-budget-2016-workers-epf-contributions-cut-3#sthash.eJOHhmP3.dpuf

 

Thursday, 28 January 2016 | MYT 12:11 PM

Najib presents revised 2016 Budget

by dina murad and akil yunus

PETALING JAYA: Prime Minister Datuk Seri Najib Tun Razak (pic) has announced a revised Budget 2016 to optimise the country's developmental and operational expenditures in the face of slower economic growth.

The revised budget will include precautionary and proactive measures in managing national revenue and expenditures, while ensuring that the well-being of the people remained a priority.

Najib said the recalibration is necessary due to a slump in global oil prices and a slower economic growth in the United States and China.

When Budget 2016 was unveiled in Parliament last October, the crude oil price was at US$48 (RM203) per barrel.

However, the current price per barrel stands at US$30 (RM127), a sharp fall since the Budget was presented.

Highlights

- The 2016 global economy expected to be more challenging and economic groweth expected to fall from 3.6% to 3.4%.

- Malaysia not alone in facing global economic challenges. Current crude oil price stands at US$31 (RM131) per barrel.

- Latest developments indicate that the global economy is at a very volatile stage and requires a proactive move to revise Budget 2016.

- We are not in a recession, neither are we in a technical recession.

- Eleven recalibrated measures announced.

- 1. EPF contributions by employees to be reduced by 3%. This is expected to increase private sector spending by RM8bil.

- 2. Tax relief of up to RM2,000 to those with income RM8,000 a month or lower. Two million taxpayers to benefit.

- 3. To reduce cost of living, Govt to liberalise APs for agricultural products including coffee beans and meats.

- 4. Domestic Trade, Cooperatives and Consumerism Ministry ordered to increase enforcement and action against unethical traders.

- 5. 30% of contributions to the human resource development fund to be utilised for skills training, including those who are unemployed.

- 6. MyBeras programme to be introduced until Dec 2016. Each hardcore poor family will be given 20kg of rice every month.

- 7. The Government will update the management system of foreign workers, with levies clustered into two categories, not including foreign maids.

- 8. Government will exercise prudent spending on supplies and services and to continue with grant rationalisation.

- 9. Development budget to focus on projects and programmes that place the people first, have high multiplier effect and reduce imports.

- 10. Development financial institutions and Government venture capital funds to increase allocations by RM6bil for benefit of start-ups and SMEs.

- 11. GLCs urged to implement initiatives to reduce the income gap between senior management and workers, to be monitored by the Economic Planning Unit.

Najib said Thursday's recalibrated budget was based on the approach of "shared responsibility" by certain segments of society.

He said lower-income groups will not be affected, and continue to benefit from measures such as the 1Malaysia People's Aid (BR1M).

"The present rate of the Goods and Services Tax (GST) will also be retained at 6%. The Government has no plans to increase this," said Najib at the Putrajaya International Convention Centre (PICC).

He also said that Malaysia would not resort to imposing capital controls and pegging the Ringgit, such as was done during the 1997-1998 financial crisis.

"The Government remains committed to maintaining the fiscal consolidation measures for 2016, which is to achieve a GDP target of 3.1%.

"Our country's debt will be reduced and will not exceed 55% of the GDP. The Government also has no plans to impose capital controls and peg the Ringgit," he said.

Najib also made mention of the Trans-Pacific Partnership Agreement (TPPA), which had been debated at a special Parliamentary sitting on Tuesday and Wednesday.

He provided assurances that with the signing of the free trade agreement, there would be no compromise on the country's sovereignty.

"The Bumiputera agenda remains intact. In fact, it is no longer a national agenda. With the TPPA, it has reached a global scale," he added. - Star, 28/1/2016

Immoral to take RM2.5 billion from 2.1 million migrant workers - LEVY more than doubled?

Higher levy for migrant workers - to pay more than RM200 per month? - UNJUST

Forced Labour? Bonded Labour? - well, when Malaysia raised the levy payable by migrant workers to RM2,500 on 1/2/2016, the amount payable monthly will be more that RM200, and with many migrant workers earning RM900 per month(Minimum Wages), will now be earning less than RM700-00, and that is so unjust. 

Hence, to survive, these migrant workers will be forced to work overtime. Malaysian laws, as it is, provide for a very unjust legal overtime limit of 104 hours - meaning for every working day, workers can be made to work an overtime of 4 hours - meaning they could be working 12 hours every working day. - See earlier post - OT - workers in Malaysia have a choice to refuse? Reduce draconian OT limit of 104 hours/month to 50 hr/mth Interestingly, the Malaysian government is said to be thinking of increasing OT limits even further.

LEVY should be paid by employers choosing to employ migrant workers rather than local workers - it acts as a DETERRENT to employers. That was the object when migrant workers levy was introduced. Labour Director-General Datuk Ismail Abdul Rahim was quated saying that, “…The rationale behind getting employers to bear the levy was to discourage them from employing foreigners…” [Star, 16/4/2009]

But alas, some employers were recuperating the monies spent for levy and other expenses, by getting permission of the Director General of Human Resources to give workers higher than permitted wage advancements OR  higher wage deductions, and then recovering vide these advancements and/or deductions the monies employer spend on migrant workers including sometimes the levy. Finally, 0n April 2009, the Malaysian stopped this practice - making it very clear once again that levy was to be paid by the employer not the workers.

Then with the coming of Minimum Wages, and responding to employers of migrant workers that their cost had increased, on or about January 2013, the government changed their position saying that now migrant workers will have to pay the levy amount ( see earlier post -KSIEWTSM makes it 74 saying No to Wage Deduction to recover Levy Payable By Employers

Annual levy payable for a Migrant Worker before was - Manufacturing sector (RM1,250), Construction sector (RM 1,250), Plantation sector (RM590), Agricultural sector (RM410) and Services sector (RM1,250 – RM1,850)(rates as checked on November 2014). Now, as of 1/2/2016, levy payable is RM2,500(manufacturing, construction and service sectors) and RM1,500(plantation and agriculture)

Now there are only two categories. The first is for those in the manufacturing, construction and service sector. Here each worker will be charged the new rate of RM2,500. "For those in the plantation and agriculture, which come under the second category, the rate is RM1,500, per workers." Zahid said domestic workers were exempted.

In brief, levy payable has doubled for construction, manufacturing and service. For plantation and agriculture, it seems to have gone up higher.

Most unjust for foreign workers already here and working now. They came on the basis of the representation as to their financial obligations (levy, work permit, medical insurance, etc) then when they decided to come to Malaysia to work, and many came to Malaysia for work for 3-5 years. To suddenly be imposed with a new obligation of having to pay themselves the Levy in 2013, and now to have to pay even more is most unjust. 

Unlike, local workers, these migrant workers have incurred many other expenses even before they came which resulted in the taking out of loans, etc (estimated about RM5,000 or more), and are now to be burdened even more financial obligations is grossly unjust. 

They are bound by contracts, and early return to their home country is problematic and not an option to many - if they elect to do so, they may lose out on entitlements like travel home cost, etc. 

For many, they have no choice, and are stuck - forced to work under ever increasing unjust conditions...(see also post, which states levy rates applicable in 2014, and I believe, there was no change until now) - Unjust to compel Migrant Workers in Malaysia to pay higher rates for healthcare in government hospitals?

Note also that the declining value of the Malaysian Ringgit, seriously impacted them - see earlier post -Dropping Ringgit - Migrant workers worst affected now, but soon all in Malaysia may experience the same?

Hence, in the name of justice, if there are to be new financial obligations, it rightfully should ONLY apply to new migrant workers coming in to Malaysia after this. Then, they will be coming to Malaysia, fully informed on all their obligations, financial and otherwise.

As it is the growing number of undocumented workers, may be because of all these restrictions and financial obligations imposed on the documented migrant worker. As it is contract substitution has always been a problem - what was promised and agreed to before they decided to come to Malaysia to work, and what happened in Malaysia when they started working was different, not just in terms of wages. 

It would be good for the Malaysian government to transparently tell us, how many of the undocumented migrant workers in Malaysia came in initially as documented migrant workers? It would also be good to know why other migrant workers chose to come to Malaysia to work as undocumented workers - rather than coming in through the proper channels as documented workers? 

Now, the reason why they come to Malaysia to work is clearly because there is work here - and there are so many Malaysian employers who are willing to risk employing migrant workers.

While Malaysia's Federal Constitution guarantees equality to all PERSONs (not just citizens) in Malaysia, and even its Employment Act has a specific provision making it illegal to treat migrant workers and local workers differently (see section 60L Employment Act 1955), the guarantee for equality. And, worse still the violator is not the Employer, but rather the Malaysian government.

For migrant workers, access to justice is certainly a problem - to complain normally results in speedy termination and the cancellation of work permits. While most government departments, tribunals and labour courts require the presence of the complainant for the complaints procedure to proceed, migrant workers who lose their right to remain in Malaysia on cancellation of their permits, are forced to leave the country - and justice is not done. Violators of the law easily escape. This is happening not just in labour cases but also criminal cases.

Now, the financial problems facing Malaysia now, should be blamed on the Barisan Nasional government under the Premiership of Najib Tun Razak. A good government, would have foreseen problems, and had in place measures to overcome it. But sadly, this government's solution is transfer the burden to Malaysians, workers and now migrant workers. Subsidies were removed, a new Goods and Services Tax was introduced shifting the burden of collecting these taxes from point of production to the the retailer and the consumer, toll rates have been increased, workers being asked to 'save less for the future' and spend money now policy, increasing levy payment obligations of migrant workers, Interestingly, no proposal to reduce peoples' representatives (Members of Parliament, Senators, ADUNs) wages/allowances that was just increased a lot, or reduce the number of Ministers in a very large Cabinet, ...

 

 

RM2.5 billion expected from new foreign workers’ levy rate system, says Zahid

Published: 31 January 2016 2:27 PM

Datuk Seri Ahmad Zahid Hamidi says a new levy system for foreign workers will be bringing in RM2.5 billion to the country. – The Malaysian Insider file pic, January 31, 2016.Datuk Seri Ahmad Zahid Hamidi said the government's decision to restructure the levy rate system for foreign workers into two categories was expected to bring an extra income of RM2.5 billion to the country.
The deputy prime minister said today the new rate would come into effect beginning tomorrow, February 1.
Previously, he said the foreign workers were charged different rates were based on the sectors where they worked such as manufacturing, construction, service, plantation and agriculture.

"Now there are only two categories. The first is for those in the manufacturing, construction and service sector. Here each worker will be charged the new rate of RM2,500. "For those in the plantation and agriculture, which come under the second category, the rate is RM1,500, per workers."
Zahid said domestic workers were exempted.
According to statistics, he said there were now some 2.135 million registered foreign workers in the country.
"Our Prime Minister Datuk Seri Najib Razak had in his 2016 national recalibrated budget speech touched on this restructuring.
"This is in accordance with the development in the country's economic scenario and that at international level."
He said the government needed to come up with the new rates as the foreign workers were also enjoying various benefits such as subsidised prices for food and other necessities, which were only meant for the country's citizens.
"They are enjoying our good infrastructures too but we are also acknowledging the vital roles they play in our nation-building and to our economy." – Bernama, January 31, 2016.

- See more at: http://www.themalaysianinsider.com/malaysia/article/rm2.5-billion-expected-from-new-foreign-workers-levy-rate-system-says-zahid#sthash.UCft6mQm.dpuf